Abstract

The global financial crisis that started in the late 2000s incited a heated debate in academic circles with divergent viewpoints. The view that dominated the debate between 2008 and early 2010, was politics that is protectionist-bid of the US and UK—that is, the war on terror, particularly in Afghanistan; and/or the quest for mineral-resource wealth—for example, the US invasion of Iraq. However, since mid-2010 the perspective has shifted to global business in most quarters with some crucial legal issues. This article argues that the primary problem is not that the GFC has affected businesses, but rather that the reverse is the case—the fraudulent business activities of multinational corporations (MNCs) and poor corporate-governance accountability issues, specifically fraudulent misrepresentations, are at the root of the crisis. This article examines on the one hand the impact of politics—security-protectionism—and on the other hand the implication of fraudulent misrepresentations within global business on the recent GFC. This is examined in theory and is analysed by applying such theory in practice using two brief empirical illustrative cases: the strained US-China economic relations and the Euro-zone crisis; as well as other examples, such as Lehman, Enron, Anderson, Mediaset and Mahindra.